After a seemingly interminable wait, it's becoming clear at last that American companies are getting some good from the United States dollar's long slide. It has taken two years, but the dollar's 30 to 40 percent drop in value relative to other major currencies, notably the Japanese yen and West German mark, is having an increasingly obvious effect.
Fourth-quarter 1986 trade deficit figures will be released tomorrow. They are expected to show a modest improvement in the nation's still heavy trade imbalance.
But for individual companies, from computermakers to chemical companies to heavy equipment manufacturers, the dollar's shift is beginning to show up in better sales, profits, and more confidence in US manufacturing ability.
One company that has clearly benefited from the dollar's fall is computermaker Hewlett-Packard (HP) of Palo Alto, Calif. The company's worldwide sales were up almost 10 percent last year; profits were up 5 percent. Sales in the first quarter of this year have risen as well.
``Hewlett-Packard's modest growth in terms of European and Japanese currencies translated into substantially increased dollar revenue in 1986,'' John Young, president of HP, said in a recent letter to stockholders. Mr. Young says the devalued dollar has enabled the company ``to press our products more competitively in Europe and Japan.''
Though not necessarily linked to the favorable currency swing, HP recently concluded an agreement with Canon, the giant Japanese electronic products concern, to supply it with computers. Those will be sold in Japan under the Canon label.
HP officials say the agreement is significant because it exemplifies a rare turnabout. More commonly, Japanese and other Asian companies sell under an American label. The HP deal shows the competitiveness of a US product in a market dominated by Japanese electronics manufacturers.
Mixed with corporate America's new glimmer of optimism, however, is an understanding that favorable currency adjustments will not by themselves revive US industry. American industry will have to battle tooth and nail for lost market share.
``We're in a much better fighting position than two years ago,'' says Gil Nolde, a spokesman for the Caterpillar Tractor Company, the heavy equipment manufacturer based in Peoria, Ill.
``We still get people coming to us saying, `Now that the yen is stronger, you guys ought to be in clover.' But that isn't quite true, because overall the industry still has too much capacity, and everybody's still slugging it out.''
Mr. Nolde explains that when the yen was in the 260 range, its Japanese rival had a 40 percent built-in cost advantage.
``That 40 percent,'' he says, ``is no longer in their court.''
Japanese companies in this country are feeling the heat to compete on the basis of price as never before. Clearly, though, they are not standing still while the dollar devalues.
The effect of the dollar on Caterpillar's archrival, Komatsu, is a case in point.
``It has definitely affected our approach to the American market and how we evaluate where we should emphasize our market strategy,'' says Jack Sample, general manager at Komatsu's new Chattanooga, Tenn., manufacturing plant.
Mr. Sample says the company has responded to the dollar's dive by speeding up its plans to expand the factory capacity to produce more equipment in the US. There has also been renewed emphasis on seeking local sources for many machine parts.
At 30 to 40 completed machines a day, the Komatsu factory has just a small fraction of what Caterpillar produces. Still, Sample says, automation allows the factory to switch production overnight, allowing the company increased flexibility to respond to changing demand.
Other Japanese companies are struggling to sell their products in the United States in the wake of the dollar's decline.
``We are not selling so many products right now,'' says Ryota Hamamoto, president of the Sumitomo Chemical America, a specialty-chemical subsidiary of the Japanese chemical giant.
``The weak dollar has given the American producer an edge,'' says Mr. Hamamoto, ``but they are so impatient for the profits, sometimes they forget to regain the market share in the United States. If that is the case, the dollar depreciation may not be good for the American producer.''
Although no one is sure just how long the dollar will remain weak, analysts say the downward shift should continue to help American companies at home and abroad.
``There's at least a little ring of optimism, whereas before everyone was pretty glum,'' says Michael Radnor, a professor of management at Northwestern University's Kellogg School.
``The Japanese are howling and screaming about how terrible it's been for them. But I think there's been some assumption on this end that, `Boy, if its terrible for them, it must mean things are getting better here.' I don't think that holds.''
The currency shift has helped US companies compete with the Japanese, he says. But a much less dramatic shift has taken place with South Korea and other export-oriented nations whose currencies are pegged to the dollar.
``I don't think we can be complacent on our end,'' Dr. Radnor says.